Moderating Role of Board Size on Debt Capital and Firm Performance of Quoted Industrial Goods Companies in Nigeria

Financing sources of any corporate organization are a serious determinant of its performance because either equity or debt financing has its cost. The interaction between them has to be evaluated periodically. Against this background, this study establishes the Moderating role of board size on debt capital and the firm performance of industrial goods companies in Nigeria. The population of the study comprises the thirteen industrial goods companies quoted on the Nigeria Exchange Group (NGX). The population was wholly sampled for the study. Debt financing represented by debt-to-total asset was the independent variable, while, firm performance) was measured by return on assets (ROA). The panel data were obtained from the financial statements of the companies from 2012-2021. The study adopts a bi-model approach for clarity of presentation and analysis. The analysis was conducted with the aid of the pooled Ordinary Least Square Multiple Regression method and the result from Model I showed that debt capital has a significant negative effect on the firm performance of the sampled companies. The result from Model II indicated that board size has an insignificant positive moderating effect on debt capital and firm performance. The study recommends that the management of industrial goods companies in Nigeria should keep debt capital at its lowest to improve their performance.